The change in the Secure Act 2.0 was to allow you to take the deduction even when the pension administrator did not make the payment directly to the insurance company (as was previously required); instead, the taxpayer could now have paid that same up to $3,000 to the insurance company and gotten the deduction.
However, the Code ("I.R.C. § 402(l)(5)(A)(i) In General ) referred to above, states that deduction is to be taken against distributions from a an Employees' Trust as defined in section 402. That is, the $3,000 is a deduction to a distribution from your pension.
However, the $3,000 can be a deduction only against taxable income from a pension. You don't seem to have any, since your $40,000 is tax-free (due to disability). This is why you are not seeing the $3,000 deduction, because you have no taxable pension income to take it against.
Even if you had other taxable income, like from an IRA, there is no taxable income from a pension for you to take this $3,000 deduction. As best as I can see from reading the current Code, TurboTax is working correctly. Where do you think the $3,000 deduction ought to appear?
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